I normally use the computers available on campus for class work. Since covid hit, we have been doing zoom classes, for my classes it is a requirement in the syllabus to have a computer/ iPad to guarantee access to internet, attendance and participation etc. If i purchase one, will I be reimbursed at the end of the year??
Q. Will I be reimbursed at the end of the year?
A. Simple answer: No. Actually answer: maybe, sort of.
The tax system does not directly reimburse you for educational expenses. But, certain education expenses (tuition is the most obvious) qualify for an education credit or deduction
Computers MAY be a qualified expense. A computer, required for class work, is a qualified expense for claiming the American Opportunity Tax credit (AOTC) . To qualify for the alternative Lifetime Learning Credit (LLC), the computer must be purchased from the school. The AOTC is not available to grad students.
A computer is not a qualified expense for the alternative Tuition and Fees deduction (TFD).
The AOTC is a maximum of $2500, $1000 of which is refundable. It only takes $2000 of expenses to get the first $2000 of the credit (so, it is, effectively, for many people, a dollar for dollar reimbursement). It only takes $4000 of total expenses to get the maximum $2500 credit. So, if you already have $4000 of expenses (tuition, fees and books), claiming the computer will not get you any more credit. Or if you already have $2000 of other expenses, the computer will only get you 25% back and only up to $500. Are you eligible for the AOTC? Most half time or more undergrads are. For full rules, See https://www.irs.gov/credits-deductions/individuals/aotc
Student-dependents are not eligible, but their parents are.
The LLC is 20% of expenses and a max of $2000, based on $10K of expenses.
NO government taxing authority will "reimburse" you for anything. But qualified education expenses may (or may not) qualify you for certain education expense deductions and credits.
The three areas of "QUALIFIED" education expenses are tuition, books, and lab fees. That's it. There are no exceptions. The cost of a computer can fall under the "lab fees" category if several conditions are met.
- The requirement for the student to own their own computer must be clearly spelled out in the syllabus for at least one of the classes the student is enrolled in.
- The computer must be purchased for the "PRIMARY" purpose of satisfying the syllabus requirement.
So if the device was purchased say, 6 months before the class started that would have been well before the syllabus was issued to new students for that class. You'll have a hard time proving the purchase was primarily for that class.
If you are eligible for the American Opportunity credit:
You can include the cost of a computer or tablet as part of your educational costs, if it is required for your program of study. However, since the AOTC maximum benefit occurs when you pay $4000 or more, adding the computing device may not increase your credit if you already pay more than $4000 of qualified costs.
If you are claiming the Lifetime Learning Credit:
You can include the cost of a computing device in your qualified expenses if it is required for your program of study AND you buy the computing device from your school. The LLC maximum credit occurs when you have $10,000 of qualified expenses, so if your expenses are less than that, adding a computing device will probably increase your credit.